Daily Archives: April 18, 2019

Uber has confirmed it will spin out its self-driving car business after the unit closed $1 billion in funding from Toyota, auto-parts maker Denso and SoftBank’s Vision Fund.

The development has been speculated for some time — as far back as October — and it serves to both remove a deeply unprofitable unit from the main Uber business, helping Uber scale back some of its losses, while giving Uber’s Advanced Technologies Group (known as Uber ATG) more freedom to focus on the tough challenge of bringing autonomous vehicles to market.

The deal values Uber ATG at $7.25 billion, the companies announced. In terms of the exact mechanics of the investment, Toyota and Denso are providing $667 million, with the Vision Fund throwing in the remaining $333 million.

Still, those crazy numbers haven’t dampened the mood. Uber is still seen as a once-in-a-generation company, and it is tipped to raise around $10 billion from the IPO, giving it a reported valuation of $90 billion-$100 billion.

Like the spin-out itself, the identity of the investors is not a surprise.

“Leveraging the strengths of Uber ATG’s autonomous vehicle technology and service network and the Toyota Group’s vehicle control system technology, mass-production capability, and advanced safety support systems, such as Toyota Guardian, will enable us to commercialize safer, lower cost automated ridesharing vehicles and services,” said Shigeki Tomoyama, the executive VP who leads Toyota’s “connected company” division, said in a statement.

Here’s Uber CEO Dara Khosrowshahi’s shorter take on Twitter:

Excited to announce Toyota, Denso and the SoftBank Vision Fund are making a $1B investment in @UberATG, as we work together towards the future of mobility. pic.twitter.com/JdqhLkV7uU